Demand for wood-protection coatings and preservatives is forecast to increase more than 2% per year to $3 billion in 2007, despite a challenging market environment, according a new study.

Continued weakness in large-siding and decking applications is prompting coating and preservative manufacturers to place greater emphasis on growing applications, such as flooring and furniture. Demand will benefit from a shift in product mix and solid levels of construction-related repair and improvement spending, according to Wood Protection Coatings & Preservatives, the new study by The Freedonia Group (Cleveland).

A shift in product mix to higher value formulations will occur in both coatings and preservatives, primarily due to environmental issues. Concerns over the release of VOCs during the coating process have initiated a gradual switch to more environmentally friendly formulations, such as waterborne coatings in on-site applications, and powder and radiation-cured coatings in factory applications.

In general, wood-protection coatings and preservatives demand will achieve the most favorable gains in interior wood applications, such as furniture, flooring and cabinets. Furniture and cabinet production will be promoted by growth in repair and improvement spending, as the purchase of these items is common during remodeling activity. To maintain wood's position in interior applications, wood coating suppliers will strive to develop product lines that feature a wider range of colors, improved efficiency and enhanced durability.